Jindal Steel FY13 capex over Rs 10k crore
Apr 23 2012, 18:27 | By PTI
JSPL produces around 4.5 million tonnes per annum at its Raigarh plant in Chhattisgarh.
Naveen Jindal-led JSPL will invest over Rs 10,000 crore in 2012-13 to part-fund its Rs 2 lakh crore capex plan that aims to ramp up its steel making capacity to 18 million tonnes in five years.
"We will be spending more than Rs 10,000 crore in FY13 to part finance the ongoing expansions in our company. We had invested around the same amount last fiscal," said JSPL deputy managing director and CEO (Steel Business) V R Sharma.
JSPL produces around 4.5 million tonnes per annum (mtpa) at its Raigarh plant in Chhattisgarh. It is now setting up three steel facilities at Angul in Odisha, Patratu in Jharkhand and Raigarh to raise capacity to 18 mtpa.
Besides, it is setting up a 4,200 MW captive power plants in Chhattisgarh and Jharkhand. The company is also investing Rs 45,000 crore in a coal-to-liquid project in Odisha.
Asked about financing the Rs 10,000 crore investment for the project, Sharma said the company was always maintaining a 2:1 debt-equity ratio for project funding.
"Our profits is Rs 4,000 crore each year, so each year, we can spend up to Rs 12,000 crore. We will have no problem to get the debt part as well. We are taking loans from banks," he said, adding, however, that the company was also getting loans from export credit agencies (ECAs).
An ECA is a quasi-governmental institution that acts as an intermediary between national governments and exporters to issue export financing. It can be taken in the form of credit or guarantees or both.
"ECAs are soft loans for 10 years. The rates are very low also," Sharma said, adding JSPL hopes to get $125 million through this route in the current fiscal.
He said the company has already invested about Rs 40,000 crore towards the planned investment. Orders have also been placed for all the proposed expansion.
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